Tuesday, May 22, 2012

$599 bankruptcy: Too good to be true?

I am a bankruptcy attorney ($995/Chapter 7) and frequently see all too many bankruptcies advertised at super low prices turn into much more than advertised for. When you shop around for a bankruptcy attorney, you need to ask them up front what that flat fee includes. When you add up all the extra costs, you could be looking at paying $3950 total! We saw that happen to someone today in a bankruptcy hearing.

It doesn't have to be that way. When you find a bankruptcy attorney, ask them up front before hiring them what the flat fee includes. Generally, the only extra costs should be the court filing fee ($306) and the 2 required financial courses (which can be found online as cheaply as $10). With rare exceptions (which have never come up for any of my clients), there should not be any additional expenses.

Here is a list of additional expenses that we do not charge extra for. Be sure to ask any attorney advertising for a super low price whether they charge extra for these. Then figure out how much the real amount will be. Is it still a good deal?

1. Attending the mandatory 341 Meeting of the Creditors. One attorney friend of ours charges an additional $400.
2. Responding to emails.
3. Responding to phone calls.
4. Pulling a credit report ($30-$50 and even more if marked up)
5. Any additional meetings with you.
6. Any additional meetings or court appearances required by the bankruptcy court.
7. Any additional motions or filings required, including adversary proceedings.
8. Copies.
9. Helping you get a loan modification on your home.

You should also ask how much you will be dealing with the attorney, or will you be mostly working with a secretary or paralegal. We've seen far too many cases go to the 341 Meeting of the Creditors where the attorney is not prepared because someone else in the firm actually did the bankruptcy.

The Alexander Bankruptcy Law Firm provides low low cost Chapter 7 and 13 personal bankruptcies. $995 Chapter 7 or $2500 Chapter 13 bankruptcies plus court filing fee. Free consultation with a compassionate attorney who will handle your case personally. Call 24/7, available to meet with you around your schedule. 602-910-6812. Conveniently located in Central Phoenix along the Camelback corridor.

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